President Luiz Inácio Lula da Silva signed, on Monday (14), the decree that regulates the Commercial Reciprocity Law. The information was confirmed by the head of the Civil House, Rui Costa, in a statement to the press after an event at the Palácio do Planalto.
The content of the decree will be published in a regular edition of the Official Gazette of the Union (DOU).
The law authorizes the Brazilian government to adopt commercial measures against countries that impose unilateral barriers to Brazilian products in the global market. The measure can be used to respond to the imposition of a 50% tariff on all Brazilian exports to the United States (US), starting August 1, as announced last week by US President Donald Trump.
According to Rui Costa, the decree does not explicitly mention any country and establishes the necessary mechanisms for the execution of the law.
“The term ‘reciprocity’ could also respond quickly if another country takes measures similar to those announced by the United States,” he explained.
Background
Approved in March by the National Congress and sanctioned in April, the new law is a precise response to the escalation of the trade war initiated by Donald Trump against dozens of countries.
In Brazil’s case, the tariff initially imposed by the US was 10% on all products exported to the North American market. The exception to this tariff range is steel and aluminum, for which the US surcharge is 25%, significantly affecting Brazilian companies, which are the third largest exporters of these metals to the United States.
The Commercial Reciprocity Law establishes criteria for responses to unilateral actions, policies, or practices of a country or economic bloc that “negatively impact Brazil’s international competitiveness”.
The law will apply to countries or blocs that “interfere in Brazil’s legitimate and sovereign choices”.
Article 3 of the text, for example, authorizes the Strategic Council of the Foreign Trade Chamber (Camex), linked to the Executive Branch, to “adopt countermeasures in the form of restrictions on the importation of goods and services,” and provides for negotiation measures between the parties before any decision.
Emergency Committee
To discuss how to respond to US tariffs, the government created an interministerial working committee, with participation from various business sectors, including industry and agribusiness.
The committee’s first meetings will take place this Tuesday (15), under the leadership of Vice President Geraldo Alckmin.
Source: Agência Brasil